Summary: Financial Statement Analysis

Building Blocks

  1. Short-term liquidity, ability to meet short-term obligations
  2. Capital structure and solvency, ability to generate future revenues and meet long-term obligations
  3. Return on invested capital, ability to provide financial rewards sufficient to attract and retain financing
  4. Asset turnover, asset intensity in generating revenues to reach sufficient profitability levels
  5. Operating performance and profitability, success at maximizing revenues and minimizing expenses from operating activities in the long-run
  6. Forecasting and valuation, projection of operating performance, ability to generate sufficient cash flows to fund investment needs and valuation

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